NEW YORK, Nov 26 (Reuters) - A former SAC Capital portfolio
manager was released on $5 million bail on Monday after making
his first appearance in a New York court on charges of making
illegal trades that hedge fund titan Steven A. Cohen personally
signed off on.

Mathew Martoma, 38, of Boca Raton, Florida, was charged last
week in what U.S. prosecutors called "the most lucrative"
insider-trading scheme ever.

Martoma was accused of helping Cohen's firm avoid losses and
reap profits totaling $276 million in the summer of 2008 by
using insider tips he obtained from a doctor about Elan Corp
and Wyeth LLC. Martoma worked for CR Intrinsic, a unit
of Cohen's SAC Capital.

Cohen was not charged with wrongdoing, but prosecutors have
said in court papers that the "owner" of the hedge fund signed
off on Martoma's recommendation to sell the shares of Elan and
Wyeth. A spokesman for SAC Capital said last week that "Mr.
Cohen and SAC are confident that they have acted appropriately
and will continue to cooperate with the government's inquiry."

At a 13-minute hearing in U.S. district court in Manhattan
on Monday, Martoma spoke only once, answering "yes, your honor"
to a judge's question. He did not enter a plea.

Magistrate Judge James Cott on Monday agreed to a proposed
$5 million bail package for Martoma, who has been free on
similar bail conditions since appearing in a Florida court after
his arrest on Nov. 20.

Martoma's wife, Rosemary, attended the hearing and agreed to
serve as one of three co-signers for Martoma's bail.

Charles Stillman, Martoma's lawyer, has said he is confident
his client will be exonerated. Stillman told reporters gathered
outside the courtroom Monday that "we took care of business
today and we'll be back another day."

The Martomas walked to the courthouse exit hand in hand.

Martoma, who began using Mathew as his first name in the
middle of his professional life instead of Ajai, worked for CR
Intrinsic in Stamford, Connecticut, until 2010. Before becoming
a healthcare stock analyst, he worked in the field of bioethics,
serving as deputy director of the National Human Genome Research
Institute's Office of Genome Ethics, according to biographical
information attached to a paper he wrote for a Harvard Law
journal. He attended Harvard Law School but left before
graduating, opting instead for an MBA from Stanford University.

He is the fifth person associated with SAC Capital, one of
the most influential hedge funds, to be charged with insider
trading in either a criminal or civil proceeding.

In a criminal complaint, authorities said Martoma spoke in
July 2008 to the "hedge fund owner" - Cohen - and recommended
selling shares of Elan and Wyeth before a negative announcement
on clinical trial results for an Alzheimer's drug jointly
developed by the two companies.

U.S. securities regulators, who have filed civil
insider-trading charges against Martoma, contend he obtained
confidential tips from Sidney Gilman, who was chair of a
committee to monitor patient safety during the Alzheimer's
drug's clinical trial.

Gilman, an 80-year old neurology professor at the University
of Michigan, is now cooperating with prosecutors after agreeing
to pay a $186,781 disgorgement. A lawyer for Gilman declined to
comment last week.

The Securities and Exchange Commission complaint said Gilman
worked as a consultant for a so-called expert network. The SEC's
complaint did not name the network, but a disclosure for a 2008
paper Gilman wrote in the journal Neurology stated that Gilman
was a consultant for the Gerson Lehrman Group. Hedge funds use
such networks to gain insight into various industries.

According to the criminal complaint, Gilman scheduled
meetings and phone calls with Martoma that allowed him to pass
on new information quickly about the drug trial.

Gilman has also worked as a consultant for the private
equity firm Longitude Capital and for the contract research firm
PPD Development, according to the 2008 disclosure.

The judge set a Dec. 26 hearing date for Martoma to return
to court, but Stillman said he expected it to be pushed back to
a later date.

The case is USA v. Martoma, U.S. District Court for the
Southern District of New York, No. 12-mag-2985.
(Reporting By Emily Flitter and Basil Katz; Editing by Tim
Dobbyn)